THIS DARK TOBACCO near Springfield, Tenn., delivered good yield and fine quality after it was harvested in September. The farmer cured as much of it as he could on scaffold wagons like the ones in the background.

Tobacco prices ended 2011 on upswing

• Some lower quality burley is likely to hit the market.
• That might bring prices down some.

By Chris Bickers, Contributing Writer | Jan 17, 2012

Burley and dark tobacco growers finished 2011 with excellent prices on their contract and auction markets, but an economist at the University of Kentucky cautioned that a downturn as marketing ends in January and February seems possible.

“We will likely have some lower quality burley to hit the market later in the season,” said Will Snell, Kentucky Extension economist, in December. “That might bring down prices some.”

But the burley market did very well before its seasonal close in late December.

Roger Quarles, a burley grower in Georgetown, Ky., said the price seemed to be going up late in the year. “Most years, that is not the case."

The growing recognition of under-production of burley was part of the reason.

“We are going to be really short on weight, compared to recent years,” said Brian Furnish of the Burley Tobacco Growers Cooperative in Lexington, Ky.

But the quality is better than the last two years, he said. He estimated that pre-Christmas prices averaged $1.75 to $1.80 per pound, with the best bringing up to $1.82. That would be roughly four to five cents a pound over the previous market.

Parts of the burley belt were helped considerably by rain from remnants of Tropical Storm Lee, which in some areas was as much as four inches. Later, it turned overcast and misty, stalling harvest to some extent.

How did this crop turn out for growers? Burley farmer Doug Langley of Shelbyville, Ky., told the Associated Press that lower yields took some of the luster off the good marketing season. “It should be profitable, but it's not a ‘landslide’ victory,” he said.

After the shock of Hurricane Irene, the flue-cured market performed reasonably well right to its end in November.

But no one was shooting off firecrackers about the 2011 crop.

A leaf dealer said about 380 million pounds of flue-cured from the 2011 crop entered the trade, at an average of about $1.78 to $1.80 per pound. “That is not going to be enough to keep some farmers viable,” he said. “Insurance won't make them whole either.”

Crop bruised, twisted, tattered

One of the areas hardest hit by Hurricane Irene was Lenoir County, N.C. “Our crop was darn near beat to death,” said Alton Roberson of Kinston, N.C. “It was bruised, twisted and tattered.”

Thanks to the storm damage, over half of his crop had to be harvested by hand instead of by machine, as he prefers to do. That created another problem, since he didn’t have enough labor on farm to do it all and had to go looking for workers elsewhere, he said.

Out of 110 barns Roberson expected to cure, he only made 44.

“The tobacco got a good reception at the market,” said Graham Boyd, executive vice-president of the Tobacco Growers Association of North Carolina. “It appeared to me the leaf that was badly compromised by the hurricane was never delivered.”

Instead, growers culled their leaf and just brought in what they thought was in demand. One farmer told Boyd he trained his workers to harvest this crop a little differently, doing most of the selecting and grading in the field and leaving bad leaf on the stalk.

“I think we are seeing what you might call a ‘premium’ retail market, with the 1s and 2s and 3s coming to market and the rest absent,” he said.

North Carolina suffered the most damage from Irene. One widely quoted estimate was that the value of the North Carolina crop was $114 million pounds less than it had been the year before, despite a slight increase in plantings. The North Carolina average yield was estimated at 1,700 pounds per acre, compared to 2,204 over the past decade.

Georgia and Florida didn't get any wind or rain from the hurricane, and there was extreme heat in July and August, said J. Michael Moore, Georgia Extension tobacco agronomist.

But there were some very good yields in Georgia. The state yield will probably be better than last year, maybe 2,400 pounds per acre, he said. "This looks like a good year for us."

Florida had a good crop too. Much of the tobacco there is irrigated, so drought was not a big consideration.

The dark air-cured and fire-cured tobacco growers of Kentucky and Tennessee apparently produced their best quality crop since 2006.

“It is a good useable crop, but it is not huge,” said Kenneth Smith, leader of the Eastern Dark Fired Tobacco Growers Association. “I have heard the companies are taking excess tobacco when they see it (to make up for unproduced contracts). One way or another, all is going find a home.”

Weights look good, said Andy Bailey, Kentucky-Tennessee Extension dark tobacco specialist. “I haven't heard of a 4,000-pound yield yet, but I know of some fire-cured yields in the 3,800- to 3,900-pound range and some air-cured yields of 3,400 pounds."

Over two-thirds of the two types had been received by Christmas, says Bailey. “We will still be delivering this crop in January and February.” Receiving began the first week of October, he said.